A) ABSTRACT / HEADNOTE

The Supreme Court allowed the State of Karnataka’s appeal against the Karnataka High Court which had quashed FIR No.54/2023 registered at Karnataka Lokayukta Police, Bangalore, under Section 13(1)(b) read with Section 13(2) of the Prevention of Corruption Act, 1988 (hereafter PC Act) in a disproportionate-asset prosecution against Sri Channakeshava H.D. The High Court premised quashing on the absence of a preliminary enquiry conducted by the Superintendent of Police (SP) before directing registration of the FIR, relying on the value of a “preliminary enquiry” in corruption matters as discussed in Lalita Kumari v. State of U.P. The Supreme Court held that no statutory provision under Sections 13 or 17 PC Act makes a preliminary enquiry mandatory; the second proviso to Section 17 merely fixes the rank of the officer (SP) whose order is necessary for investigation of offences under clause (b) of Section 13(1). Where a detailed and reasoned source report disclosing prima facie disproportionate assets is before the superior officer, the requirement of a fresh/formal preliminary enquiry may be relaxed. On the facts specifically a source report dated 05.10.2023 finding prima facie disproportionate assets of Rs. 6,64,67,000/- during 11.11.1998 – 30.09.2023 and the SP’s order dated 04.12.2023 the Court held the SP had applied his mind and lawfully directed FIR registration; quashing was thus improper. Appeal allowed; impugned high court order set aside.

Keywords: Preliminary enquiry; Section 17 proviso; Disproportionate assets; Source report; FIR quashing; Prevention of Corruption Act; Superintendent of Police; Lalita Kumari.

B) CASE DETAILS

C) INTRODUCTION AND BACKGROUND OF JUDGEMENT

The appeal challenges a High Court order quashing corruption proceedings instituted against a serving public servant Sri Channakeshava H.D., an Executive Engineer with BESCOM on the narrow ground that the SP who authorised investigation had not conducted an independent preliminary enquiry before directing FIR registration. The prosecution alleged accumulation of disproportionate assets during a long check period (1998–2023). The operative legal tension arises from the interplay between (a) Section 17 PC Act, which insists offences under clause (b) of Section 13(1) be investigated only after an order of an officer not below SP-rank, and (b) judicial dicta  notably Lalita Kumari and P. Sirajuddin which recommended preliminary enquiry in certain sensitive categories including corruption. The High Court treated the absence of a contemporaneous preliminary enquiry by the SP as fatal, concluding the SP had not applied independent mind and that the FIR was susceptible to quashing in exercise of Section 482 CrPC. The State contested that approach, arguing that (i) no statutory mandate compels a preliminary enquiry; (ii) where a detailed source report containing exhaustive material is placed before the SP, that source report itself may amount to the requisite antecedent material and justify immediate registration; and (iii) authority in T.N. Sudhakar Reddy and CBI v. Thommandru Hannah Vijayalakshmi supports that no absolute right exists for the accused to be heard before FIR registration in a DA case. The Supreme Court framed the question: did the High Court err in quashing because the SP purportedly failed to conduct a preliminary enquiry?

D) FACTS OF THE CASE

Sri Channakeshava H.D. joined service on 11.11.1998 and rose to be Executive Engineer at BESCOM. Allegations, arising from official checks, claimed he acquired movable and immovable assets — some in benami names — not commensurate with his known legal income. A source report dated 05.10.2023, prepared by a Deputy Superintendent of Police, catalogued properties and concluded a prima facie disproportion of Rs. 6,64,67,000/- (≈92.54%) over the check period 11.11.1998–30.09.2023, also identifying plausible additional assets at multiple residences and offices. Relying on that source report, the Superintendent of Police passed an order on 04.12.2023 under Section 17 PC Act directing registration of FIR No.54/2023 at Karnataka Lokayukta Police for offences under Section 13(1)(b) read with Section 13(2). Investigation commenced. The respondent filed a writ petition before the Karnataka High Court seeking quashing on the basis that the SP did not conduct a fresh preliminary enquiry or afford opportunity to explain, thereby vitiating the SP’s order for want of application of mind. The High Court accepted that reasoning and quashed the FIR (order dated 25.04.2024). The State appealed.

E) LEGAL ISSUES RAISED

i. Whether a preliminary enquiry is statutorily mandated before an SP may order investigation under the second proviso to Section 17 PC Act in offences under clause (b) of Section 13(1)?
ii. Whether a detailed source report placed before the SP can substitute for a preliminary enquiry and satisfy the requirement of application of mind?
iii. Whether absence of a personal hearing to the public servant or an independent preliminary enquiry by the SP necessarily renders the FIR liable to be quashed under Section 482 CrPC in disproportionate-assets cases?

F) PETITIONER / APPELLANT’S ARGUMENTS

i. The State submitted that no provision in Sections 13 or 17 mandates a formal preliminary enquiry; the second proviso to Section 17 refers only to the officer’s rank.
ii. The SP’s order dated 04.12.2023 was passed after considering a detailed source report dated 05.10.2023 which contained prima facie particularised material including quantified disproportion; that report constituted sufficient antecedent material and amounted to a reasonable basis for registration without a further preliminary enquiry.
iii. Reliance was placed on State of Karnataka v. T.N. Sudhakar Reddy and subsequent precedents holding that preliminary enquiry in corruption matters is discretionary and not a vested right of the accused.
iv. The State argued that permitting mandatory preliminary enquiry or pre-registration hearing would unduly handicap detection of corruption and permit pre-emptive suppression of investigations.

G) RESPONDENT’S ARGUMENTS

i. Counsel for the respondent contended that the SP did not conduct any preliminary enquiry and therefore failed to apply independent mind; mere placement of a source report cannot substitute for the SP’s own enquiry.
ii. It was argued that absence of opportunity to explain or any notice resulted in procedural unfairness and enabled FIR registration to be used as a tool of harassment.
iii. Reliance was placed on the judicial recognition (in P. Sirajuddin and Lalita Kumari) of the desirability of preliminary enquiries in corruption matters to protect public servants from mala fide or frivolous allegations.

H) JUDGEMENT

The Supreme Court after analysing statutory text and precedents concluded: (a) Section 17 does not contain language requiring a preliminary enquiry; its second proviso only prescribes the rank of the officer whose order is needed for investigation of offences under clause (b) of Section 13(1). (b) Judicial dicta in P. Sirajuddin and Lalita Kumari had treated preliminary enquiry as desirable in categories (including corruption) but did not convert the desirability into an absolute, inflexible rule in all cases. The Court reiterated that the necessity of preliminary enquiry depends on facts and circumstances and is discretionary. (c) The Court observed that where a superior officer is seised of a source report which is detailed and well-reasoned and which a reasonable person would regard as prima facie disclosing a cognizable offence, the superior officer may lawfully proceed to order registration without conducting a fresh enquiry. The Court relied on its recent exposition in T.N. Sudhakar Reddy to the same effect. (d) On the facts, the source report dated 05.10.2023 was comprehensive: it traced service history, listed suspected benami holdings, quantified disproportion (Rs. 6,64,67,000/-), and suggested likely locations for further discovery. The SP’s order of 04.12.2023 explicitly records consideration of that report. (e) The Court further cited CBI v. Thommandru Hannah Vijayalakshmi to affirm that a public servant has no right to be heard prior to FIR registration in a DA case. (f) Consequently, the High Court’s broad approach — that lack of a preliminary enquiry by SP ipso facto invalidates the process — was held to be erroneous. The Supreme Court set aside the High Court order and restored the FIR and subsequent investigation.

a. RATIO DECIDENDI

The controlling ratio is that a preliminary enquiry is not an absolute statutory prerequisite for registration of FIR in corruption matters under the PC Act. When a superior officer, namely an SP, is presented with a detailed, particularised and reasoned source report which prima facie discloses a cognizable offence under Section 13(1)(b), the SP may — in the exercise of administrative and investigative discretion — order registration without conducting a separate, fresh preliminary enquiry. The requirement under Section 17 is limited to the rank of the authorising officer and does not import a procedural duty to hold preliminary enquiry or pre-registration hearing in every instance.

b. OBITER DICTA

The Court reiterated the welfare of a balanced approach: while preliminary inquiry is desirable in particular categories, courts must avoid erecting procedural barriers that render anti-corruption mechanisms ineffective. The Court emphasized fact-sensitivity — lack of preliminary enquiry will not always invalidate FIRs and each case must be judged on the material before the authorising officer.

c. GUIDELINES

i. Preliminary enquiry remains desirable in corruption and other sensitive categories, but is not mandatory as a legal precondition.
ii. When an SP’s order relies on a source report, that report must be sufficiently detailed and reasoned to justify immediate registration.
iii. Courts, while exercising Section 482 CrPC jurisdiction to quash FIRs, must scrutinise whether the superior officer applied independent mind to antecedent material rather than mechanically rubber-stamping; mere absence of fresh enquiry is not decisive.
iv. Public servants do not possess an inherent right to be heard prior to FIR registration in disproportionate asset investigations; opportunities for hearing may arise later in the process.
v. High Courts should not entertain quashing at interlocutory stages unless material demonstrates patent mala fides, non-application of mind, or total absence of any prima facie case.

I) CONCLUSION & COMMENTS

The judgment clarifies the boundary between procedural safeguards and investigative efficacy in corruption prosecutions. It anchors the law on statutory text and prior precedents: desirability of preliminary enquiry does not morph into mandatory pre-condition for FIR registration. Practically, the decision gives prosecuting agencies latitude to act on well-documented source reports, while signalling that courts retain power to quash where there is demonstrable non-application of mind or mala fide action. For practitioners, the decision underlines careful preparation of source reports (particularisation, valuation, nexus to service, traceable benami indicators) when approaching superior officers for authorisation. For respondents, remedies against investigative overreach remain available but must be grounded in demonstrable procedural or substantive infirmity rather than the mere absence of a formal preliminary enquiry. The ruling thus balances protection of civil servants from harassment with the State’s imperative to investigate serious corruption effectively.

J) REFERENCES

a. Important Cases Referred

1. State of Karnataka v. Sri Channakeshava H.D. & Anr., Criminal Appeal No. 1849 of 2025, [2025] 4 S.C.R. 608 : 2025 INSC 471.

2. Lalita Kumari v. Government of Uttar Pradesh & Ors., (2014) 2 SCC 1 (discussion on desirability of preliminary inquiry).

3. P. Sirajuddin v. State of Madras, (1970) 1 SCC 595 (preliminary enquiry observation).

4. State of Karnataka v. T.N. Sudhakar Reddy, 2025 SCC OnLine SC 382 (recent exposition on discretionary nature of preliminary enquiry).

5. CBI v. Thommandru Hannah Vijayalakshmi, (2021) 18 SCC 135 (no inherent right to explanation before FIR in DA cases).

b. Important Statutes Referred

1. Prevention of Corruption Act, 1988 — Sections 13(1)(b), 13(2), 17.

2. Code of Criminal Procedure, 1973 — Section 482 (inherent powers of High Court).